A Research On The Value-Relevance Of Fair Value

Our country's New Accounting Standards promulgated in 2006 has widely introduced the fair value concept.The Standard-setter's original purpose of using the fair value is to provide more relevant accounting information for the information users, reflect the financial position and operating results better and help investors make rational investment decisions.Then, after the introduction of fair value, does the accounting information of value relevance have been improved? The fair value becomes the focus of discussion again, after the financial crisis sweeping the globe in 2008, which caused by U.S. subprime mortgage crisis. It is particularly necessary to study the value relevance of fair value within this economical context.Banking, insurance, building & real estate sectors play a very important role in capital markets, and the fair value has a broader application in these industry, therefore,this study uses price model and return model to make a test based on Samples of the listed companies of banking, insurance, building & real estate sectors in the A share market.This paper's main conclusions are as follows:(1) Loss or profit from changes of fair value and changes of fair value of financial assets available-for-sale are both correlated with the stock price.(2) There is significant correlation between Loss or profit from changes of fair value and stock returns in 2008,and There is no correlation between Loss or profit from changes of fair value and stock returns in 2009, Loss or profit from changes of fair value did not pass the test in 2009.These findings can not only effectively eliminate people's anxiety to the zigzag utilization of fair value in our country, but also provide support in the view of empirical research to the standards'constitutors. So the results of this paper can impel the widespread application in some degree.